Virtu Financial enters into amended employment agreement with execs
Virtu Financial Operating LLC (VFO), a subsidiary of Virtu Financial, Inc., has entered into an amended and restated employment letter agreement with each of Brett Fairclough, the Company’s Co-President & Co-Chief Operating Officer, Joseph Molluso, the Company’s Co-President & Co-Chief Operating Officer, and Stephen Cavoli, the Company’s Executive Vice President, Markets.
The Amended and Restated Employment Agreement for Mr. Fairclough has an initial term expiring February 26, 2027, for Mr. Molluso expiring April 30, 2026, and for Mr. Cavoli expiring February 26, 2026, in each case with automatic one-year renewal periods unless either party elects not to renew.
Under the Amended and Restated Employment Agreements, each of the Executives’ annual base salary is $600,000 per year, and the Executives will each be eligible to receive annual bonuses with a target bonus opportunity equal to $2,000,000 and a maximum bonus opportunity equal to $3,000,000. Fifty percent (50%) of the annual bonus will be based on the achievement of quantitative targets and 50% of the annual bonus will be based on the achievement of qualitative goals, in each case set by the Company’s Chief Executive Officer together with the Compensation Committee of the Company’s Board of Directors.
The Amended and Restated Employment Agreements also reflect changes to certain terms and conditions, including those described below, intended to achieve consistency with those of the Second Amended and Restated Employment Agreement of the Company’s Chief Executive Officer, Mr. Douglas Cifu, dated as of April 29, 2022.
The Executives will each be eligible to receive an equity award at the beginning of each calendar year during the Term. It is the current intention of the Board and CEO that each Annual Equity Grant will be in the form of 75,000 restricted shares or restricted stock units (RSUs) in respect of shares of the Company’s Class A common stock that are subject to performance and service conditions.
The number of Shares earned under each Annual Equity Grant will be based on the percentage of budgeted EBITDA achieved in the applicable calendar year, with 100% of Shares earned upon at least 65% achievement. In the event of achievement below 65%, the Compensation Committee of the Board will determine the number of earned Shares, if any, in its sole discretion.
To the extent any Shares are earned with respect to an applicable Annual Equity Grant, 50% of such Shares will vest on the last day of the calendar year to which such award relates and the remaining 50% will vest on the last day of the subsequent calendar year, subject to each Executive’s continued employment through each applicable vesting date.
The Performance Target also applies to the performance-based equity awards previously awarded to Mr. Cifu for fiscal year 2022 in accordance with the terms of the April 2022 Cifu Agreement and pursuant to an amendment dated as of December 1, 2022 to the applicable award agreement.
Under the Amended and Restated Employment Agreements, if an Executive’s employment is terminated by VFO without cause, due to death or disability, by the Executive for good reason, or due to the expiration of the Term on the expiration date as a result of the Company’s delivery of a notice of non- renewal of the term, then in addition to receiving his accrued amounts, the Executive will be entitled to, subject to the execution of a release of claims: (1) severance pay in an aggregate amount equal to the greater of (a) one times his base salary or (b) the amount of base salary that would have been paid through end of the Term but for the termination (the “Severance Amount”); (2) continued health, dental, vision and life insurance benefits under the terms of our benefit plans for (x) twelve months or (y) the period from termination of employment through the remainder of the Term, whichever is longer (the “Benefits Continuation Period”); (3) remain eligible to earn restricted Shares or RSUs under his then-current Annual Equity Grant, and to the extent earned, a pro rata portion of such Shares or RSUs, as applicable, shall be deemed vested on the last day of the calendar year to which such award relates (the “Eligible Equity Acceleration”); (4) accelerated vesting of any earned but unvested restricted Shares or RSUs under the Annual Equity Award granted in the year prior to the year of termination; and (5) 75,000 fully-vested Shares or, if the Executive has made an applicable and timely deferral election, deferred stock units (sections (3), (4) and (5) collectively, the “Equity Acceleration”).